Reagan Bows to Congress, Will Join Talks on Deficit

WASHINGTON — Under pressure from Congress, President Reagan agreed Thursday to become personally involved in talks to cut the federal budget deficit.

Reagan will meet today with Republican congressional leaders to discuss tax and spending issues before they resume the Capitol Hill budget summit with Democrats. Senate Minority Leader Bob Dole (R-Kan.), who had appealed Wednesday for the President’s participation, hailed Reagan’s decision. “Not a single member on either side wants to give up” the search for a budget agreement, he said on the Senate floor.

‘We Must Not Fail’

Dole’s call for renewed efforts was joined minutes later by the majority leader, Sen. Robert C. Byrd (D-W.Va.), who said: “We must not fail. I have good reason to believe a potentially good, strong meaningful agreement is there.”

Dole’s announcement that Reagan will discuss the budget gave new impetus to the negotiations, which had become severely bogged down. Democrats charged that the Administration officials participating in the meetings had refused to fairly consider raising taxes to help defray the deficit.

Democrats insist that taxes should supply $12 billion of $23 billion in cuts needed to avoid automatic across-the-board reductions later this month through the Gramm-Rudman deficit reduction law and they have demanded a definite sign that the President is willing to compromise.

The budget negotiators spent Thursday reviewing a plan by Sen. Pete V. Domenici (R-N.M.) to limit cost-of-living increases for recipients of government checks. Such programs include Social Security and civilian and military pensions.

However, such a plan would be politically explosive and could face strong opposition from lawmakers who will face voters next year.

The negotiators have been struggling to reach agreement despite serious political differences on the deficit reduction issue. The President and congressional Republicans want to achieve most of the deficit savings by cutting government spending, while the Democrats insist more revenue is needed.

Need to Reassure Markets

However, both stress that they recognize a need to reach an agreement to reassure nervous financial markets.

Congress must take the “hard votes” to bring the budget into balance, said Sen. Rudy Boschwitz (R-Minn.). “It is absolutely imperative the President of the United States engage himself in the negotiations. He has not done that extensively enough to this point.”

Early in the day, Speaker Jim Wright (D-Tex.) had told reporters he was losing hope in the negotiations and indicated he planned to begin working to draft a congressional deficit-reduction alternative--”not as a fallback plan but as a fall-forward plan.”

Harsh Automatic Cuts

Unless lawmakers can reduce the deficit--now projected at $178 billion--by at least $23 billion, scores of government programs will face harsh automatic spending cuts on Nov. 20.

“It comes to the point where we can’t just hide behind the President’s intransigence,” Wright said.

But by the end of what was termed a hard-bargaining afternoon negotiating session, even the most pessimistic participants were talking of new hope.

“Things look brighter,” said Rep. Silvio O. Conte (R-Mass.). “It was the first time since we met that things got heated. . . . At this point, we need some pounding of the table.”

However, House Majority Leader Thomas S. Foley (D-Wash.) cautioned that while the negotiators are hoping to put together a package that could cut the deficit by up to $28 billion, they are “not on the verge of an agreement imminently, nor are we on the verge of a breakdown.”

One source said that while the participants are seriously discussing limiting cost-of-living increases in many government programs, they are particularly leery of touching the Social Security program.